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Has Everything Changed After Powell Speech?
Powell's speech was the only Fed communication on the calendar today, but they surprised markets by dropping a policy change on their website. Suddenly, the journalistic coverage of today's Powell speech no longer seems insanely presumptuous. But did the Fed really say anything new? And if not, why are markets reacting like they are? We'll discuss this in today's video.
Econ Data / Events
20min of Fed 30yr UMBS Buying 10am, 1130am (M-F) and 1pm (T-Th)
Jobless Claims 1.006m vs 1.0m f'cast
Q2 GDP (1st revision) -31.7 vs -32.5 f'cast
Market Movement Recap
08:16 AM Moderately stronger to start after quiet overnight trading. Treasuries were unchanged until 3am, then rallied modestly with European bonds. Stocks are effectively unchanged and MBS are opening 3 ticks (0.09) higher.
09:23 AM Both stocks and bonds improved moderately but quickly as the Fed surprised the market with an actual policy document on its website (more on that HERE). 10yr yields were down more than 3bps for a moment, but have bounced 1bp up to .667. 2.0 UMBS rallied and bounced as well--currently right in line with pre-Powell highs. Even as this is typed, a potential knee-jerk bounce is taking shape. More to follow if that continues...
09:46 AM Knee-jerk confirmed. MBS down nearly a quarter point from the post-Powell highs. 10yr yields up 2.5bps on the day.
01:09 PM 7yr auction was decent--not decent enough to change bond market momentum all by itself, but yields are off their highs by just over 1bp. MBS are down only an eighth of a point on the day.
MBS Commentary
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Has Everything Changed After Powell Speech?
Powell's speech was the only Fed communication on the calendar today, but they surprised markets by dropping a policy change on their website. Suddenly, the j... (read more)
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Mortgage Rate Watch
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With several major developments and interesting milestones in the mortgage world, I'm seeing a lot more confusion than normal. So let's clear it up without too many extra words or meaningless rants. I heard rates were 1.99%. What's up with that? Ever... (read more)
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Rob Chrisman
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While Louisiana is focused on Hurricane Laura, 2,200 miles away California is focused on its wildfires… and regulations. Remember that about 25 percent of the United States’ residential loan production comes out of California, so plenty ... (read more)
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Housing News
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July marked the third consecutive outsized increase in the Pending Home Sales Index (PHSI) produced by the National Association of Realtors® (NAR) It also was the third of three July sales measures to surprise analysts. NAR said the PHSI, a leadi... (read more)
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Housing News
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While the Gulf Coast escaped the threat of two simultaneous hurricane hits, the remaining storm, Hurricane Laura, looks like an historically dangerous one. It, and the wildfires ravaging California, has prompted Freddie Mac to restate its disaster re... (read more)
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Housing News
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Freddie Mac reported this week that its total mortgage portfolio increased at an annualized rate of 20.0 percent in July compared to a 14.2 percent gain in June. The portfolio balance at the end of the period was $2.476 trillion compared to $2.436 tr... (read more)
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